fill settings on a layer in Photoshop seem to do the same thing. What is the difference?
When we set the Opacity value for a selected layer, the change applies to the entire layer. This means that any layer styles and blending mode for that layer are also affected.
When we set the Fill value,only painted pixels and vector items are affected,layer styles and blending mode remain same. i tried to show you the main difference between both, Check this SS.
you can specify a Fill value and blending mode for a layer and only the fill pixels inside the shape are affected-not the layer styles applied to the layer. If you use the Opacity option to adjust transparency both the shape and effects are affected.i used inner shadow and stroke as layer style,i chose opacity 5% to show you coz in 0% there is nothing to display. hope this may clear you confusion.
The Fill slider affects only the layers content.
The Opacity slider affects the entire layer, including any effects, such as drop shadow, inner glow, etc.
The difference is in when it comes to layer styles.
If you haven't added any effects (styles) to your layer, like a stroke, drop shadow, bevel and emboss or outer glow, you'll get the same results when lowering either the Opacity or Fill values.
If, on the other hand, you do have one or more layer styles applied, Opacity and Fill behave very differently... Try adding some text to an image, add some layer styles to the text, and then change opacity and fill values. You will notice that opacity changes everything, and fill changes all except the layer effects you added.
Read this article as it does a fantastic job and showing the difference: http://www.photoshopessentials.com/basics/layers/opacity-vs-fill/